What future for AI in healthcare?

One of the chapters in Nicholas Hall’s recently published New Paradigms report, entitled The Digital Revolution, provides some compelling examples of consumer healthcare companies and OTC brands that are thriving in the digital era. While key marketers like GSK were slow to invest in digital, the tide is now turning – in its 2018 annual report, GSK said it had “significantly” increased its advertising spend in online media because it is delivering a “far higher return” than traditional TV – despite continuing reservations from some companies like P&G about the way digital budgets are deployed.

One emerging technology that has an uncertain future in healthcare is artificial intelligence. Back in March, a report published by MMC Ventures (in partnership with Barclays) predicted that AI can “unlock a paradigm shift in healthcare”, particularly in diagnosis, drug discovery and monitoring. According to MMC’s research, health & wellbeing is a “focal point” for AI entrepreneurship – 21% of start-ups serve the sector, more than any other sector – and, over the next decade, “developers will have a greater impact on the future of healthcare than doctors”.

An example of innovation here is L’Oreal’s augmented reality and artificial intelligence entity, ModiFace, which has led to the launch of a consumer digital skin ageing diagnostic tool. Targeting women, its first application is Vichy SkinConsultAI – based on ModiFace’s AI-powered algorithm – launched in Canada in January 2019 and rolling out across the brand’s websites globally over the course of this year.

However, security concerns continue to be the main stumbling block for AI. According to research published in Digital Health last month, public concern about accuracy, cybersecurity and the inability of AI-led chatbots to sympathise may be standing in the way of artificial intelligence’s successful introduction into healthcare.

A University of Westminster-led team surveyed 216 participants on a range of demographic and attitudinal variables including questions about acceptability and perceived effectiveness of AI in healthcare. The results identified three broad themes: “understanding of chatbots”, “AI hesitancy” and “motivations for health chatbots”. The team suggests that designers of AI-led chatbots need to employ user-centred and theory-based approaches to address patient concerns and to optimise user experience in order to achieve the best uptake and utilisation.

Embracing Tech and Digital Health are two of the key themes at our OTC.NewDirections Executive Conference, taking place in London on 14 November 2019! Nicholas Hall will be joined by experts from companies including Bayer, Mundipharma and J&J to review these issues, as well as others impacting our industry, including the status of Medical Cannabis in Europe, Growing Brands through Innovation and the ultimate theme of ensuring that you are Keeping Consumers in the Spotlight. To find out more, or to reserve your place, please contact jennifer.odonnell@NicholasHall.com without delay!

Big Data to democratise healthcare

Another of the Infinity Zones that Nicholas Hall will be exploring in his upcoming New Paradigms report is Big Data. Healthcare is an increasing focus of the global Big 5 tech companies, namely Google, Apple, Facebook, Amazon and Alibaba (with the latter predicted to be the “biggest of all in future” by Nicholas). All of these companies own vast reservoirs of consumer information (“big data”) that can be leveraged to provide targeted advertising and services.

In an interview with CNBC in early 2019, Apple’s CEO Tim Cook said that health will be the company’s “greatest contribution to mankind” and indicated that various services would be rolled out later this year, building on the success of the new ECG-enabled Apple Watch. Over the weekend, it was revealed that Apple has acquired Tueo Health, a California startup developing a smartphone app that works with sensors to detect asthma-related issues in sleeping children and alert the parents or guardians.

How the Tueo Health app works

In recent years, Apple has also acquired Gliimpse, a startup developing technology to aggregate medical records, and Beddit, a sleep sensor company. Apple sees its mission as “democratising” healthcare by putting its big data in the hands of consumers and empowering individuals to manage their own health via apps and dashboards. Apple’s vast user base gives it an advantage over its tech rivals, and the expected launch of its own medical devices (i.e. hearing aids) and services (i.e. blood glucose monitoring) will expand its healthcare appeal further.

As Nicholas points out, however, privacy concerns continue to plague big data initiatives and European authorities in particular have issued various fines to tech companies for breaching strict new data privacy laws (GDPR). The need for tech companies to process our personal information with ever more sensitivity will become even greater once they have access to healthcare metrics such as our blood pressure, sleep patterns, etc.

Big Data will be one of the key topics in our upcoming report, Nicholas Hall’s New Paradigms for CHC 2019: Over the Horizon, written by Nicholas himself! Examine each aspect of the CHC industry in 20 chapters, with a focus on major issues including Regulation, Pharmacy Point-of-Care, M&A, Switch and much more. Nicholas will also unveil the “infinity zones” he has identified as being crucial to the future growth of the industry. In addition to this, you can upgrade your purchase to include a customised in-house presentation or webinar with Nicholas for an additional GB£10,000. To find out more or to place your order, please contact melissa.lee@NicholasHall.com.

Emerging Markets drive OTC growth in 2018

Emerging Markets constitute one of the 10 Infinity Zones for future CHC growth that we highlighted in our recent blog previewing Nicholas Hall’s upcoming New Paradigms report. Recent figures from the IMF’s World Economic Outlook forecast that developing economies will continue to outpace advanced economies and, according to the latest data from DB6, Rest of World (Middle East & Africa + Kazakhstan) and Latin America (including Puerto Rico) growth – 7.2% and 9.5% respectively – fast outpaced that of the the global OTC market (+4.0%) in 2018.

Middle East & Africa and Latin America still account for a relatively small share of global OTC sales – 7% and 5% respectively – but both are rising in power every year. Brazil (+10.1%) is the No.9 OTC market globally, while Mexico (+6.9%) ranks 16th globally in terms of OTC market size. As for the Middle East & Africa, there are now three countries clustered close together in the global OTC rankings – South Africa (+8.7%), Turkey (+15.8%) and Saudi Arabia (+6.7%) – claiming the 19th, 20th and 21st positions.

As well as double-digit growth in Turkey, there were also strong OTC performances from Algeria (+8.6%), Egypt (+15.2%), Nigeria (+7.9%) and UAE (+7.8%) in 2018. High consumer demand for preventive medicines is a key driver of CCA and VMS growth in key markets such as Egypt. According to a DSM survey of almost 7,000 people in EMEA (Europe, Middle East & Africa), some of the top health concerns for the young include immunity and resistance to disease and colds.

Multinationals have already established a strong foothold across the Middle East & Africa, but in some countries like Egypt and Iran local marketers still remain dominant. GSK, Sanofi and Bayer are the Top 3 OTC marketers in the region, followed by South Africa’s No.1 OTC marketer Adcock Ingram and RB. GSK’s OTC portfolio is highly focused on analgesics, especially Panadol, while Sanofi and Bayer have extensive VMS portfolios across the region.

Available on tablet, smartphone and desktop, OTC DASHBOARD covers 63 markets across the world, allowing you a bird’s eye view of the CHC market! We’ve now published our latest Q4 update, giving you the most up-to-date trend reports on Middle East & Africa markets such as South Africa, Turkey and Saudi Arabia. Contact hannah.burke@nicholashall.com to find out how you can benefit from OTC DASHBOARD by setting up a free trial today!

Bidding starts for Nestle Skin Health

According to a Reuters report, private equity companies Cinven and Advent have teamed up to table a joint bid for Nestle Skin Health, which sources believe values the company at CHF7bn (US$7bn). It is reported that other private equity companies, including Blackstone, KKR and Carlyle, are likewise poised to make bids, while sources also say that Merz Pharma is interested and looking for private equity partners. 

In terms of the timeline, Nestle’s Board of Directors decided to explore strategic options for the skin health business in September 2018, after concluding that future growth opportunities lay increasingly outside the group’s strategic scope. Information memos on the sale, being run by Credit Suisse and Evercore, are expected to be sent by the end of this month and first-round bids are likely to be submitted in early March.

Nestle Skin Health divides its portfolio into two units – its range of largely Rx “medical solutions” marketed under the Galderma umbrella and its “consumer solutions”.  Differin Gel is one example of a Galderma Rx skin care medicine which has been switched to OTC status, gaining FDA approval in 2016 and launched in the US in early 2017. Despite being the first genuinely new allopathic treatment in the acne category, Differin sales only reached US$17mn in the brand’s first full year since switch, leading Nestle to revamp the brand in late 2017 with line extensions and packaging updates.

Nestle Skin Health’s key consumer brands are Cetaphil, Loceryl and Benzac, as well as the home treatment acne programme Proactiv. Cetaphil is its key OTC brand, according to DB6, thanks to its expansive range and wide skin care positioning, from eczema & psoriasis to acne and anti-itch. Cetaphil Dermacontrol and Cetaphil Restoraderm are both well-established in the US market, while Cetaphil also has a strong presence in Australia, Brazil, Germany and several Middle Eastern countries.

Nicholas Hall’s recent report, Dermatologicals: Trends, Innovations, Opportunities, analyses the Derma market from the global level down to individual category-by-category reviews. This key report also examines medical devices, cosmeceuticals and much, much more. It covers launch activity, innovations and emerging niches, spanning a range of categories, including eczema & psoriasis, cold sore treatments and wound care. To purchase your copy or to find out more, please contact melissa.lee@NicholasHall.com.

MAT Q1 2018: 5 key trends & developments

Our latest Q1 2018 trend reports on the OTC market at global, regional and Top 20 level are now available on the OTC DASHBOARD website. Here we highlight some of the key trends & developments that have emerged in the latest data.

1. Growth draining out of allergy remedies: In the MAT Q1 2018 period, global growth of OTC allergy remedies slowed to just +0.2%. Compare this with a rate of +3.7% in the year-ago MAT Q1 2017 period, and +10.3% in the MAT Q1 2016 period. This gradual slowdown, caused primarily by a drop-off in Rx-to-OTC switch activity, has been one of several key factors in the continued low growth of the global OTC market (+4.1%) in Q1.
2. J&J edges ahead of Sanofi: The latest MAT Q1 2018 data indicates that J&J is now the No.3 OTC marketer globally, marginally ahead of Sanofi and just behind Bayer. Every one of the Top 5 OTC marketers grew at a rate below that of the global OTC market in the MAT Q1 2018 period, indicating the difficulty in finding new growth opportunities and the continued emphasis on M&A.
3. Has probiotics growth peaked? Though it remains high at +9.2% in the year to end-March 2018, the global growth of the probiotics category has slowed over the past year, when compared with a rate of +14.0% in the year-ago MAT Q1 2017 period, and +10.8% in the MAT Q1 2016 period. Innovation and expansion of the category into new countries and niches, such as diabetes, have fuelled its growth thus far, but we’ll be keeping a close eye over coming quarters to see if this trend is a temporary blip or the start of a long-term slowdown.
4. Where’s the growth potential? 1. Adjacencies: OTC marketers are increasingly looking to build new consumer healthcare adjacencies, either via switch – in the case of erectile dysfunction and Pfizer’s Viagra Connect – or new product innovation, in the case of medical cannabis. Though we don’t yet include sales of medical cannabis products in OTC DASHBOARD, we do track developments in this category closely in both our innovation database, OTC New Products Tracker, and regulatory newsletter, OTC.NewDirections.
5. Where’s the growth potential? 2. New territories: Coverage of the OTC market in the Middle East & Africa is one of the main benefits of being an OTC DASHBOARD subscriber, and looking at the latest Q1 data highlights the importance of this region to the relative success of GSK and RB. GSK performed better than the rest of the Top 5, with its CCA brand Otrivin moving up the Middle East & Africa rankings to the No.3 spot in Q1 after double-digit growth, while global No.6 RB (+4.4%) outperformed the global OTC rate thanks in part to the high MEA growth of Gaviscon and Strepsils.

Explore how we can innovate (and manage the impact of regulatory challenges) at our 1st OTC.NewDirections Executive Conference in London on 12th September 2018: Where Innovation meets Regulation. Nicholas Hall and Nina Stimson will be joined by speakers from Medical Brands, Angelini and Arqus Advisory among others to review, discuss and debate major issues impacting the competitive landscape in an industry in which the regulatory goalposts are continually moving. Sessions span New Product Opportunities, Regulatory Affairs (including the potential impact of Brexit across the EU), Medical Devices, Switch, Digital Marketing, New Distribution and e-Commerce. Don’t hesitate — book before 31 July to save with our early-bird discount! For more information on this pivotal meeting, please contact Lianne.Hill@nicholashall.com

ROW growth accelerates to 6.7% in 2017

One of the core benefits of your OTC DASHBOARD subscription is unrivalled coverage of the OTC market in the Middle East & Africa. Sales in this region now total US$8.8bn, following an impressive 6.7% upturn in 2017, and below we highlight some of the key recent trends & developments in this dynamic region.

Two of the region’s Top 5 markets, Turkey and South Africa, feature in the global Top 20 and both outpaced the regional trend in 2017. Turkey’s OTC market was particularly dynamic, partly driven by price inflation but also rising volume sales, thanks to growth in consumer spending and also strong investment from multinational OTC marketers, who compete with well-established local companies like Abdi Ibrahim and Santa Farma.

As well as double-digit growth in Turkey, where Bayer is the No.1 marketer, there were also strong performances from Algeria (+10.0%), Egypt (+16.4%) and Nigeria (+8.2%). GSK occupies a strong position in Egypt and Nigeria, thanks largely to the popularity of painkillers such as Panadol, and is committed to expanding its OTC portfolio and widening distribution.

Sanofi is the leading OTC marketer in Algeria, again thanks to a well-established analgesics portfolio (Doliprane and Aspegic), in addition to a fast-growing CCA range. Overall, GSK, Sanofi and Bayer are the standout OTC marketers in the region, joined by South Africa’s No.1 Adcock Ingram and RB.

For a deep dive into our Q4 2017 data and trend reporting on all Middle East & Africa markets, be sure to log on to the OTC DASHBOARD website or app (which can be downloaded on Apple or Android smartphones).

Q4 2017 Update Now Live!

We’ve just updated the OTC DASHBOARD website with full-year 2017 data and trends for all regions and all 64 countries that we track worldwide. There’s no better way to start exploring this vast reserve of information than our new homepage, which provides at-a-glance global OTC sales by region, marketer and category, as well as an interactive global map with data on the Top 20 countries. Here, we round up some of the highlights from the latest Q4 2017 update.

One of the major trends in Q4 2017 was the drop-off in global OTC growth. A 4.1% rise in 2017 was the lowest annual growth for the global OTC market since 2014, with Europe (+2.7%) and North America (+2.9%) at the heart of the slowdown. Asia-Pacific was up 4.3%, while the two smallest major regions – Latin America (+11.8%) and the Middle East & Africa (+6.7%) – grew fastest.

Looking at categories, Derma (+2.5%) underperformed most, while CCA growth slowed to just 4.3% by end-2017, with vitality continuing to drain out of allergy remedies (+3.1%). Cough remedies (+5.4%) and systemic cold & flu (+4.0%) also reported much lower growth by year-end, especially in Europe.

The overall shares of the global OTC market by major category remained stable in 2017. Analgesics (+4.5%) and Lifestyle OTCs (+4.5%) were the main driving force behind OTC growth, and the Rx-to-OTC switch of Viagra Connect in the UK in 2018 bodes well for development of the erectile dysfunction category. GIs advanced by 4.3%, while VMS (+4.2%) produced another year of solid growth.

As for marketers, the Top 5 remained unchanged in 2017 despite further M&A activity and speculation; in Pfizer’s earnings call yesterday, CEO Ian Read said he has not yet received an acceptable offer for the OTC business and may decide to retain it. The major recent M&A news was that P&G has agreed to buy Merck KGaA Consumer Health and at the same time to dissolve its PGT joint-venture with Teva. By our calculations, the new P&G will rank 7th in the global OTC marketer rankings by value, and the new Teva (assuming it retains its OTC business) will rank 12th.

Other highlights:

• Looking at OTC brand rankings, analgesics Tylenol and Advil – both of which are former global No.1 OTC brands – now trail by a fair distance behind new No.1 brand Vicks, which grew by 12% in 2017

• Abbott moved ahead of Merck KGaA to claim a spot in the global OTC Top 20, following dynamic growth of 10.6%, including double-digit rises for laxative Duphalac in Russia and antidiarrhoeal Pedialyte in the USA

Log on to OTC DASHBOARD now for access to all Q4 2017 data and trends.

MAT Q3 2017: Trends to look out for in 2018

Intense work is underway to complete the Q3 2017 update early next week, which will provide OTC DASHBOARD subscribers with the latest trend info and analysis on the performance of the global OTC market. In the meantime, taking a closer look at the latest news and data does reveal a few trends that are likely to characterise the OTC space in 2018, not least:

– The growing power of the Emerging Markets

– A coming shake-up of the global Top 10 OTC marketers

As this week’s infographic demonstrates, Turkey was one of the leading contributors to OTC growth in the MAT Q3 2017 period. Over recent years, both Turkey and South Africa have emerged as global Top 20 OTC markets, powered by high growth (though the trend in South Africa did show signs of slowing in Q3 2017). In No.21 spot, Algeria looks poised to enter the Top 20 in the very near future, thanks to continued high growth (+10% MAT Q3 2017). To keep up with the latest trends in the Middle East & Africa, OTC DASHBOARD remains your best port of call.

Top 3 Middle East & Africa markets, according to MAT Q2 2017 data

As for the leading OTC marketers, the big news in 2017 was Pfizer’s October announcement that it would be starting a bidding war for its consumer healthcare division, with RB, J&J and GSK all widely cited as possible suitors. However, there were at least two other major developments in 2017 that could cause a shake-up of the global Top 10 in the coming years – in October 2017, Novartis announced that plans to spin off its Alcon eye care business, following a strategic review, would be delayed until H1 2019 at the earliest, while in the same month the FT reported that Merck KGaA was pressing ahead with the sale of its consumer healthcare unit.

Nestle has been cited as a potential suitor for Merck KGaA’s OTC business and will be one of the companies to watch next year. Last week, Nestle agreed to acquire Canadian-based Atrium Innovations from investors led by Permira Funds for US$2.3bn cash. Atrium will become part of Nestle Health Science upon closing, which is expected in Q1 2018. Atrium’s largest brands are Florida-based Garden of Life, which manufactures certified organic, non-GMO supplements sold in health food stores and online in the US, and the Pure Encapsulations line of hypoallergenic, research-based dietary supplements sold in the US via healthcare practitioners, online and in pharmacies in several European markets. The portfolio also includes specialty brands such as Wobenzym, an oral enzyme combination containing proteolytic enzymes + bioflavonoid for osteoarthritis pain. 

If Nestle were to also acquire the Merck KGaA OTC business next year, and continue on its path of strong M&A growth, it could soon break into the global OTC Top 10. In addition, Merck KGaA would not only be a good fit with Nestle’s strategy of expanding in the field of high-quality vitamins, minerals & supplements, but would also give the company a strong foothold in the Emerging Markets, where Merck KGaA currently generates around half of its global Consumer turnover.

Pfizer OTC up for sale: How the OTC industry could be transformed

Near the end of last week, a Reuters news story broke indicating that Pfizer would be opening an auction process for its OTC business as early as this November, and that preliminary discussions had already taken place. GSK and RB have been tipped as frontrunners in securing a deal, though P&G, Sanofi, J&J and Nestlé have also been cited as possible bidders.

In Friday’s OTC.Newsflash bulletin, Nicholas Hall stated that there could possibly be 3-4 strategic buyers in the final bidding, and that the eventual selling price of Pfizer’s OTC unit could rise above US$20bn.

During GSK’s Q3 2017 results presentation, CEO Emma Walmsley confirmed that the company is interested in bidding for Pfizer’s OTC division and “building up our Consumer business”. However, there was a note of caution when the GSK CEO stated that “our first focus in capital allocation was clearly around our biggest business in Pharma, and R&D within that”. 

Using the latest DB6 figures for the MAT Q2 2017 period, now available on the OTC DASHBOARD website, we have created a graph below showing how the global Top 5 in the OTC industry would be transformed if GSK was to snap us Pfizer’s OTC business (assuming, of course, that there wouldn’t be any divestments):

As you can see, the deal would put GSK far ahead of its rivals, and make it the standout OTC marketer in what it is currently a very tight and competitive Top 4. Likewise, we also analysed the data to see the impact of RB acquiring Pfizer’s OTC unit on the global Top 5 and again the result would likely be a clear new global No.1:

As ever, it’s hard to be sure how the situation will unfold, and it’s possible that Pfizer may even decide to hold on to its OTC business, but whatever happens we’ll be sure to keep you updated with the latest news and analysis here at OTC DASHBOARD.

Ibuprofen associated with blood pressure rise in arthritis patients at CVD risk

According to the European Society of Cardiology, ibuprofen is associated with increased blood pressure and hypertension compared to celecoxib in patients with osteoarthritis or rheumatoid arthritis and increased risk of cardiovascular disease.

Nonsteroidal anti-inflammatory drugs (NSAIDs), both non-selective and selective cyclooxygenase-2 (COX-2) inhibitors, are among the most widely prescribed drugs worldwide, but are now linked with increased blood pressure and adverse cardiovascular events.

NSAID labels include warnings about potential increases in blood pressure but there is little data on the effects of individual drugs. Maintaining or achieving blood pressure control in patients with arthritis and concomitant hypertension could avoid more than 70,000 deaths from stroke and 60,000 deaths from coronary heart disease each year.

The study which found the results, PRECISION-ABPM, was a prospective, double blind, randomised, non-inferiority cardiovascular safety trial. It was conducted at 60 sites in the US and included 444 patients, of whom 408 (92%) had osteoarthritis and 36 (8%) had rheumatoid arthritis. All patients had evidence of, or were at increased risk for, coronary artery disease.

Patients were randomised in a 1:1:1 fashion to receive celecoxib (100–200mg twice a day), ibuprofen (600–800mg three times a day), or naproxen (375–500mg twice a day) with matching placebos.

Principal investigator Prof Frank Ruschitzka, professor of cardiology and co-head, Department of Cardiology, University Heart Centre, Zurich, Switzerland, said: “PRECISION-ABPM showed differential blood pressure effects between the different NSAIDs, ibuprofen and naproxen, and the COX-2 inhibitor celecoxib. While celecoxib and naproxen produced either a slight decrease (celecoxib) or a relatively small increase (naproxen) in blood pressure, ibuprofen was associated with a significant increase in ambulatory systolic blood pressure of more than 3mmHg.”

“Patients receiving ibuprofen had a 61% higher incidence of de novo hypertension compared to those receiving celecoxib,” Prof Ruschitzka continued.

These results support and extend the findings of the PRECISION trial, demonstrating non-inferiority for the primary cardiovascular outcomes for moderate doses of celecoxib compared with naproxen or ibuprofen.